Author: Frank KaneSun, 2017-07-02 04:14ID: 1498948789606276800
DUBAI: Lawyers, accountants and other professional advisers stand to make up to $1 billion in fees as a result of the collapse of the Saudi Arabia-based Al-Gosaibi business empire in 2009, one of the senior executives at the heart of the affair has told Arab News.
The 70-year-old Al-Gosaibi conglomerate collapsed in 2009 with billions of dollars of debt amid a raft of allegations of fraud, theft and forgery, leading to eight years of legal and financial actions in the Middle East, London, New York and the Cayman Islands. It was one of the biggest corporate failures to ever hit Saudi Arabia.
In an exclusive interview, Simon Charlton, acting chief executive of the Al-Gosaibi family partnership that is trying to finalize a settlement deal with family creditors, said: “It’s about time this ended. The professional fees have run into the hundreds of millions of dollars for the whole affair, the whole process of litigation and liquidation. I wouldn’t be surprised if the total fees come to more than $500 million, even as much as $1 billion by the end of it.”
The Al-Gosaibis blamed the collapse on Maan Al-Sanea, a financial entrepreneur who married into the family. They accused him of siphoning off billions of dollars in loans arranged on forged documents.
Al-Sanea has consistently denied these allegations and fought legal actions around the world to defend himself. His representatives did not respond to requests for comment on the matter.
The collapses in 2009 — of the Al-Gosaibi family businesses and the Saad Group owned by Al-Sanea — put at risk an estimated $20 billion in loans that they could not repay.
Both sides hired armies of lawyers, accountants, liquidation experts, lobbyists and media advisers. There is still ongoing litigation in the Cayman Islands, where the biggest trial in the history of the Caribbean tax haven is expected to decide soon on the ownership of about $1 billion of disputed assets.
There are also ongoing legal actions in Saudi Arabia, and more expensive professional advisers could be hired. A special judicial tribunal in Alkhobar, appointed to enforce a settlement in the dispute, recently took out a newspaper advertisement seeking lawyers, accountants and sales agents with regard to enforcement procedures against the assets of Al-Sanea and Saad Group.
The Al-Gosaibi conglomerate has been trying to reach a settlement with its creditors for years. Recently it announced it has got the agreement of a majority of banks and other creditors for a settlement that would return them a guaranteed minimum of 25 cents for each dollar owed, rising to about 50 cents depending on the result of legal actions.
Main category: Business & Economyrelated_nodes: Saudi Arabia’s multibillion corporate collapse: Al-Gosaibi exec on his role in 8-year saga